Privatization in Central-East Europe and the CIS
Working Paper #72
The wisdom and economic effects of privatization in Central and Eastern Europe (CEE) and the Commonwealth of Independent States (CIS) are currently the subject of intense re-examination. While today privatization is under debate, in the early 1990s privatization was widely considered one of the keystones of the entire transition process. From the start it was clear, however, that privatization in and of itself would not be sufficient to insure an effective functioning of the newly created market economies. Since the impact of privatization was often viewed as dependent on the presence of specific accompanying policies and systemic changes, we include in this paper a brief evaluation of such policies and changes that presumably influenced the effects of privatization. We also discuss the key systemic changes and policies that, along with privatization, were carried out, in full or in part, during the transition in CEE and CIS. We examine the macro- and microeconomic evidence about the determinants, extent and effect of privatization. We conclude our study with a number of policy-oriented observations.
About the Authors
James T. Shotwell Professor of Global Political Economy; Director, Center on Global Economic Governance
School of International and Public Affairs, Columbia University
Jan Svejnar focuses on the effects of government policies on firms, labor and capital markets; corporate, national, and global governance and performance; and entrepreneurship.
Professor Svejnar previously served as director of the International Policy Center at the Gerald R. Ford School of Public Policy at the University of Michigan. He is a founder and Chairman of CERGE-EI in Prague (an American-style Ph.D. program in economics that educates economists for Central-East Europe and the Newly Independent States). He serves as the Chairman of the Supervisory Board of CSOB Bank and co-editor of Economics of Transition. He is a Fellow of the European Economic Association and Research Fellow of the Center for Economic Policy Research (London) and Institute for the Study of Labor (IZA, Bonn).
Professor Svejnar was honored for his distinguished work with a 2012 Neuron Prize from the Prague-based Karel Janeček Endowment for Research and Science. He was one of three honorees for lifelong achievement, a recognition considered to be the Czech Republic's most prestigious for science. The Endowment spokesperson stated:
Prior to joining Columbia University in 2012, Professor Svejnar taught at the University of Michigan, University of Pittsburgh, and Cornell University. He received his B.S. from Cornell University’s School of Industrial and Labor Relations and his M.A. and Ph.D. in Economics from Princeton University.
CERGE, Charles University and the Economics Institute
University of Michigan